On
Wednesday, July 10, the House passed H.R. 2609—which Bloomberg News called a “$30.4 Billion
Energy-Water Spending Measure.” The 2014 Energy-Water Development
appropriations bill will cut spending on renewables and other green energy
programs in half and was passed mostly along party
lines—with 4 Republicans voting against and 7 Democrats for it.

Democrats
offered amendments to the bill aimed at restoring
funding
to renewable energy programs, which failed. Republicans’ amendments focused on
cuts: Rep. Tim Walberg of Michigan sponsored an amendment that would eliminate
spending for a national media campaign promoting alternative energy, and Rep.
John Fleming, M.D. of Louisiana sponsored an amendment to stop a $3.25 billion
green energy loan program—both were approved.

While
many of the different taxpayer funded green energy programs introduced in the
2009 stimulus bill —which have produced more than 50
bankrupt,
or near bankrupt, projects—have now expired, the Fleming
amendment
draws attention to a pot of money that is, currently, largely unspent.
Fleming describes this remaining
boondoggle: “The Obama 2009 stimulus bill cost taxpayers about $830 billion,
and much of it was wasted on growing government and administration giveaways,
like a $3.25 billion loan program that put taxpayers on the hook for failed
green energy projects. A company could take a government loan and walk away
from a project without paying taxpayers back, even if the company remained in
business. In a free market economy, companies may turn to banks and investors
to borrow money, but the government should not force taxpayers to be lenders,
even as it gives borrowers a pass on paying back their loans.”

While
Republicans realize the embarrassing failure of the stimulus bill’s green
energy programs, Democrats want to keep spending—often in the face of
opposition from their usual supporters. One of the most controversial
commercial green energy projects,Cape Wind,
provides a case in point.

Proposed
in 2001 for Massachusetts’ Nantucket Sound, the Cape Wind project will span a
highly-congested 25-mile area known for frequent fog and storms that is
surrounded by shipping routes used by shipping operators, ferry lines,
commercial fishermen, and recreational mariners. The Cape Wind industrial
offshore wind energy project consists of 130 440-foot high, wind turbines (made
in Germany, potentially financed by a Japanese bank) and nearly 100 miles of
cable.

In
2010, the National Park Service deemed Nantucket Sound to be eligible for
listing on the National Register of Historic Places as a Traditional Cultural
Property (TCP) because of its cultural significance to the local Wampanoag
tribes. (Note: a TCP designation successfully blocked uranium mining in New
Mexico.) The Mashpee Wampanoag Tribe on Cape Cod and the Wampanoag Tribe of
Gayhead/Aquinnah on Martha’s Vineyard believe that Cape Wind would not only
desecrate sacred land, but also harm their traditional religious and cultural
practices. In opposition to Cape Wind, the Wampanoag Tribe of Gayhead/Aquinnah
currently has a lawsuit pending in U.S. District Court in DC.

Nantucket
Sound is home to several species of endangered and protected birds and marine mammals
and has been designated an Essential Fish Habitat. Cape Wind’s construction and
operations would threaten this rich and fragile environment. Numerous
environmental organizations, led by Public Employees for Environmental
Responsibility, have a lawsuit pending for violations of the Endangered Species
Act and the Migratory Bird Treaty Act.

Opposition
to Cape Wind also comes from groups who side with jobs and economic
development.

· Commercial fishermen,
who earn the majority of their income in the area of the proposed site, believe
this project would displace commercial fishing and permanently threaten their
livelihoods. They vehemently oppose Cape Wind.

· A decline in tourism,
according to the Beacon Hill Institute at Suffolk University, would lead to the
loss of up to 2,500 jobs and property values would decline by $1.35 billion.

· Located in an area with
more than 200 days of fog per year and quickly changing weather, Cape Wind
would create significant navigational hazards for thousands of commercial and
recreational vessels and pose an unacceptable risk to aviation safety. The
local ferry lines, which transport more than three million passengers every
year, have called the project “an accident waiting to happen.” All three local
airports strongly oppose the project and have expressed safety concerns for the
millions of passengers flying over the Sound each year.

· The project would impose
billions of dollars in additional electricity costs for businesses, households,
and municipalities throughout Massachusetts. Dr. Jonathan Lesser, President of
Continental Economics, calls Cape Wind a “poster child for green energy
excess.” In a 2010
peer-reviewed paper,
he stated: “the billions of dollars Massachusetts ratepayers will be forced to
pay for the electricity it generates will not provide economic salvation but
will simply hasten the exodus of business, industry, and jobs from the state.”

Despite
widespread opposition, President Obama and Governor Patrick are closely allied
and working together to push Cape Wind forward for political advantage. Audra
Parker, President and Chief Executive Officer of the Alliance to Protect Nantucket Sound (APNS), says Cape Wind
is “a project that is controversial, extremely expensive, and one that has been
propelled forward by shortcuts, bending of rules, and political favoritism.”

Freedom
of Information Act (FOIA) requests and House Oversight Committee research found
significant coordination between the Patrick and Obama administrations through
the Department of Interior to push Cape Wind forward and gain financial
assistance for Cape Wind through the loan guarantee program. For example, a
June 24, 2011, email (acquired through APNS FOIA requests) describes a request
by the White House to include Cape Wind in an economic briefing for the President
on the loan guarantee program: “The WH was very direct about what should be
included in the slides so we don’t have much flexibility.” The email
specifically stated that the White House wanted: “1 slide on status of Cape
Wind (because he [the President] has heard from Gov. Patrick a few times – they
are close friends).” In the months prior and after Cape Wind was notified that
its application for section 1705 assistance was put on hold, there were
numerous meetings and calls between MA state officials, including Governor
Patrick, with senior officials at Department of Energy (DOE)and the Loan
Guarantee Program, including the usual players: Jonathan Silver and Secretary
Chu.

In
April, US News addressed a new
Government Accountability Office (GAO) report that points to federal
subsidies for wind energy that are rife with wasteful spending: “The GAO report
finds substantial overlap in federal wind initiatives. This duplication allows
some applicants to receive multiple sources of financial support for deployment
of a single project.”

Once
again, the $2.6 billion Cape Wind construction is illustrative of how the
overlaps can give the developer more in taxpayer-funded benefits than the
project’s actual cost. Federal incentives, including a $780 million energy
investment credit, a DOE loan guarantee, and accelerated depreciation could be
more than $1.3 billion—or more than 50% of the project’s cost. But, this just
represents the federal package. Add in state incentives and the combined total
could be $4.3 billion—exceeding the projected cost by 167%. Cape Wind claims to
create only 50 permanent jobs—which would equal a staggering $86 million per
job.

But,
it is not just the money—though in the current constrained fiscal environment,
money is a huge consideration. Government agency recommendations and/or
policy—including the Advisory Council for Historic Preservation, the Federal
Aviation Administration (FAA), the Bureau of Ocean Energy Management,
Regulation and Enforcement, and the US Fish and Wildlife Service—had to be
overridden or overlooked to prevent “undue burden on the developer” that “could
possibly bankrupt them.”

For
example, a May 3, 2010, FAA PowerPoint presentation to Eastern Service Area
Directors includes a slide titled “Political Implications” which states: “The
Secretary of the Interior has approved this project. The Administration is
under pressure to promote green energy production. It would be very difficult
politically to refuse approval of this project.”

While
this quick overview of the Cape Wind project barely touches the surface issues,
it highlights the folly of allocating billions of dollars of state and federal
money for green energy projects at the expense of the taxpayers. Any stimulus
funds designated for green energy, but not yet “invested,” should be withdrawn;
taxpayers should be taken off the hook—which is the goal of the Fleming
amendment passed on July 10.

Too
bad these specifics in the 2014 Energy-Water Development appropriations bill
are little more than a representation of the different approaches of the
parties: one wants to fund more green energy projects and the other wants to
cut—which also reflects the division throughout America. Because our government
is operating on one continuing resolution after another, the appropriations
bill is a mere formality. As pointed out on June 25, at
Georgetown University,
President Obama intends to “invest in the clean-energy companies”—despite the
exorbitant financial cost of the projects and economic damages they will cause the public.